Ayala eyeing ‘minority stake’ in targeted Indon thermal projects

By Myrna M. Velasco – February 1, 2018, 10:00 PM
from Manila Bulletin

The energy investment arm of Ayala Corporation is positioning for a ‘significant minority stake’ on the scale of 20%-30% for targeted thermal power projects in the broadening energy market of Indonesia.

The Ayala group first dipped its investment hand on that market via renewable energy ventures, but its next foray will already be on thermal power projects, like coal and gas-fired power facilities.

AC Energy President and Chief Executive Eric T. Francia said “we’re looking at mega-projects, like multi-gigawatt type projects where we can take minority stake.”

Primarily for developments that could be in the scale of 2,000 megawatts, the company chief executive emphasized that “if ever we consider that, it will be a minority stake probably in the 20%-30% orders of magnitude.”

Francia qualified though that “there are no specific megawatts for now. All I can say is, in Indonesia, the thermal opportunities there are huge.”

He is referring to the 35,000MW invitation for power investments that the government of Indonesia had set out – and with the Ayala group already having its presence in that market, it is not likely to pass up on that other opportunity.

Francia opined that Indonesia remains a ‘highly viable market’ – not just because of its huge base of end-users, but primarily due to the independent power producer- type of project development that their power sector is still anchored in.

“Their market is easily over four times larger than the Philippines, and they’re growing rapidly and they are going to face supply challenges. So the government has embarked on this 35GW plan – and a lot of that is going to come from thermal – whether its coal or gas,” he stressed.

One striking come-on to prospective investors, according to Francia, is hinged on the fact that the capacity of the power developments shall be underwritten by a power supply agreement with state-run power utility Perusahaan Listrik Negara (PLN).